PACRA Maintains Stability Rating of NIT Government Bond Fund
|Rating Type||Stability Rating|
The rating reflects the strength of the fund's credit and interest rate risk profile. At end Dec-19, 30% of fund's assets were invested in PIBs (3 Years, 5 Years and 10 Years), whereas 44% of exposure was maintained in T-Bills. Duration of the fund remained high at end Dec-19 (377 days), exposing it to interest rate risk. However, the PIBs are included in the portfolio on short term basis to take advantage of monetary policy easing. The unit holding pattern of the fund is highly concentrated with top ten investors representing ~78% of the fund's assets, (out of which ~43% are owned investments) which exposes the fund to low level of redemption pressure.
Going forward, the plan intends to maintain its asset allocation in higher rated banks and government papers. The exposure in PIBs will be shifted towards short term T-Bills and/or as bank placement's. Material changes in the fund's asset allocation strategy, impacting its credit quality and/or exposure to interest rate risk, would affect the rating.
National Investment Trust Limited was established in 1962 as an unquoted public limited company. It is the first asset management company of Pakistan and is the pioneer of domestic mutual fund industry. The company’s Board of Directors currently comprises ten board members out of which nine are non-executive. Mr. Adnan Afridi has been appointed as the Managing Director of the company in Feb-19. The authority for appointment of CEO/Managing Director lies with the Government of Pakistan.
Mr. Adnan Afridi, Managing Director of the company, holds profound experience in the financial services and capital markets. Mr. Manzoor Ahmed is the COO and has a successful track record of managing the operations and investment portfolio of the company. They are supported by a team of qualified and experienced professionals. The company is currently one of the largest asset management companies in Pakistan with a portfolio of five conventional funds and two shariah-compliant funds with overall assets under management of ~PKR 85 billion at the end of Dec-19.